Kumba To Continue Defending South Africa Sishen Iron Ore Right
02/17/2012| 06:15am US/Eastern
Kumba Iron Ore Ltd. (KIO.JO), South Africa's largest iron ore producer, said Friday it will continue to defend its ownership rights to the Sishen mine as the country's mineral department appeals a high court decision from last year.
Kumba, a subsidiary of Anglo American PLC (>> Anglo American plc), launched legal action in August, accusing the government of wrongly awarding a lucrative stake in Sishen to politically connected Imperial Crown Trading, or ICT.
The 21.4% stake was previously owned by ArcelorMittal South Africa (ACL.JO), which had lost the right after it failed to convert it under the new mineral laws. Kumba already owned the remaining stake.
In December 2011, a Pretoria high court ruled that Kumba was the owner of 100% of Sishen and therefore the Department of Mineral Resources, or DMR, was wrong in awarding the stake to ICT and therefore that deal was void.
Early this month, both the DMR and ICT submitted applications to appeal against the High Court judgment, Kumba said.
"[Sishen Iron Ore company] will continue to take the necessary steps to protect its shareholders' interests in this regard," Anglo American said in its results Friday.
In the meantime, an interim pricing agreement that Kumba said was invalid after ArcelorMittal lost its Sishen stake has been extended to July 31, 2012, Kumba said. Arbitration between the two over the pricing agreement has also been postponed until the stake legal proceedings are concluded.
-By Devon Maylie, Dow Jones Newswires; +27117837848; email@example.com